Blonigen, Bruce A. (Bruce Aloysius)
Kolpin, Van
2003-12-15T20:25:47Z
2003-12-15T20:25:47Z
2003-09-01
http://hdl.handle.net/1794/135
25 p.
The active "courting" of firms by municipalities, regions, and even nations has a long-standing history and the competition for firm location through a wide variety of incentives seems to have escalated to new heights in recent years. We develop a model that explores technology development by firms that face regional competition for their investment and examine the endogenous determination of regions� policies, firm technology, and agglomeration externalities. In particular, we find that regional competition leads firms to inefficiently distort their development and selection of production technology in hopes of improving their standing in the competition amongst regions for their investment. This loss in efficiency is aggravated by the agglomeration externalities that are inherently present in many industries. We offer several case studies that provide evidence consistent with our theoretical conclusions.
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University of Oregon, Dept of Economics
University of Oregon Economics Department Working Papers;2003-21
Public economics
Local government
State government
Intergovernmental relations
State and local taxation
Subsidies
Revenue
Industrial organization
Firm objectives, organization and behavior
Organization of production
Microeconomics
Production and organization
Firm behavior
Economic development
Technological change
Innovation and invention
Technological innovations
Technology, Agglomeration, and Regional Competition for Investment
Working Paper